The following correction was printed in the Observer's For the record column, Sunday May 31 2009

The capital of Turkey is Ankara, not Istanbul, as we said in the article below.

Rising numbers of British holidaymakers are falling victim to scams while abroad that can leave them thousands of pounds out of pocket.

Over 400,000 Britons are expected to part with money for rip-off "free holiday" deals this year as fraudsters become more imaginative and ruthless in the way they dream up and implement new tricks, experts warn.

The Office of Fair Trading estimates that the growing numbers of holidaymakers being persuaded to opt for a "free" trip are typically cheated out of £3,000 a head. When the European Union clamped down on timeshare scams, many fraudsters turned their attention to these free holiday scams.

The fraud is perpetrated, typically, on a beach and begins with the scamsters dishing out scratchcards. Every card results in the recipient being told they have won a free holiday, which they then have to claim at a 90-minute presentation.

These presentations can last five hours, according to Which?, and people's resistance is so worn down that they often end up agreeing to all sorts of extras, for which they will have to pay through the nose.

Although EU legislation is in place to protect consumers, Amanda Diamond of Which? Holiday warns that it is "down to enforcement bodies in the relevant countries to crack down on hard-selling techniques".

Holidaymakers may be vulnerable to scams when they are abroad because they are away from their normal surroundings and are in a relaxed state of mind, letting their defences down. Right now, mid-recession, they may also be trying to save money so might be more tempted by cheap offers.

A more common, worldwide scam that every holidaymaker should guard against is overseas credit card fraud.

Last year, more than £231m was lost on British credit cards abroad, according to Apacs, the UK payments association, a rise of 11% on 2007. The US and Romania are two countries where such fraud is particularly common.

The best advice is never to let your card be taken out of your sight - as it can then be easily copied. Although your card issuer will usually refund losses, the process can be worrying and stressful and you are more likely to fall victim to identity fraud in future.

Prior to going abroad, holidaymakers can familiarise themselves with the specific Foreign and Commonwealth Office (FCO) advice for their destination, as there is a vast difference between the types of fraud typically carried out from one country to another.

In Cyprus and Israel, for instance, there is very little fraud aimed at holidaymakers, whereas Mexico - which had been tipped as one of the big destinations for Britons in 2009 by the Foreign Office - is one of the most dangerous, even setting aside the current swine flu health issues.

Street crime is on the increase there and unlicensed taxi drivers often prey on foreigners. Armed robberies of entire busloads of passengers still occur, according to the Foreign Office, despite some bus companies checking the ID of travellers first in order to spot potential robbers.

"Express kidnapping" - in which the victim is frogmarched to an ATM and forced to withdraw and hand over their money - is also well-known. And the FCO also advises: "Be wary of persons presenting themselves as police officers attempting to fine or arrest you for no apparent reason."

In Nigeria, about 600 Britons were defrauded last year, some suffering "great financial loss", according to the FCO, in the kind of bank account scams that are perpetrated in the UK. Across the Atlantic in Argentina, holidaymakers should be on the alert for con-merchants who "accidently" spill tomato ketchup on you and then take your wallet as they help clean you up.

In Thailand and in Turkey's capital, Istanbul, there is a particular problem with strangers offering foreigners food or drink that turns out to be drugged. And in South Africa, a common con is operated by people offering to help vulnerable tourists withdraw money from a cash machine.

How to beat the fraudsters

• "Read up on your destination as much as possible before you travel, so you're aware of what kind of scams are common in that country," says Jess Prasad, head of consular publicity at the FCO. Scams vary from country to country and may also go in and out of fashion, so it pays to get up-to-date information. (Go to fco.gov.uk and enter "Know Before You Go Campaign" into its search facility.)

• Be particularly careful in areas that scamsters will be drawn to, such as railway stations and their surroundings. Avoid cul-de-sacs, small roads with poor lighting and ATMs with poor visibility. Ask hotel staff about which areas to avoid. Some hotels can be located near red-light zones, which can feel like a threatening environment after nightfall.

• Be wary of charming, over-friendly people. "Fraudsters are very articulate and skilled," says KPMG's Hitesh Patel of the growing band of people offering to sell timeshares.

• Take contact details with you for the British Embassy as well as copies of your travel insurance. Be ready to act quickly if something goes wrong.